Does your company trade in and provide virtual currency, like bitcoins? Or are you a custodial wallet provider? Then you have to register with De Nederlandsche Bank (DNB). Virtual currency (also called ‘crypto coins’) is vulnerable to financial crime. This article tells you how to register as a broker.
Why must you register?
You must register because digital currencies are used by criminals to launder money, and to finance terrorism. When you register, you come under the supervision of DNB. DNB monitors if you abide by the legislation to combat money laundering. It is your responsibility to check transactions for unusual activities, and to perform a background check of your customers. DNB oversees how you do this. For instance, by researching your company.
No registration? No services
It is illegal to provide services for exchanging or storing crypto coins. Registration also makes you trustworthy in the eyes of customers and suppliers.
Who has a duty to register?
The duty to register applies to all brokers in the Netherlands who exchange legal tender, such as euros and dollars, for crypto currency, and the other way around. The registration duty also applies to custodial wallet providers. Foreign crypto services brokers who want to trade in the Netherlands must also register.
How do you prepare your registration application?
To register, you must file the following information with DNB:
A company plan, outlining the strategy, and overview of the activities and a SWOT analysis
Composition of the board, including organisational and control structure
Delineation of the business operations and management, including rules and regulations, audit, notification procedure, secondment, training, and education
Description of business operations
A file per board member, demonstrating their fitness and propriety
When you apply for registration, DNB will also perform an integrity supervision of your company board. You have to submit a separate application for this. There are 2 steps to take:
Step 1: Apply for registration
You apply for registration through the DLT (Digital Supervision Portal) by filling out the complete application form and uploading your company information file. You need eHerkenning to apply via the DLT. Make sure you have it, and make sure you have the correct level eHerkenning.
No authorisation, no application
Your eHerkenning provider must authorise you for using the service ‘Applying for supervision’. You cannot apply without it.
eHerkenning level 1 discontinued per 1 July
eHerkenning token level 1 (low security) no longer meets the (international) security standards set for electronic ID. It will be discontinued per 1 July 2021. Make sure to upgrade your level 1 token, if you have one, before then.
Step 2: Request a fit and proper assessment
You file the information on your board members’ fitness and propriety separately, also through the DLT. You use the form ‘Initial assessment crypto service providers’ for this, via the Digital Supervision Portal. Find more information on this process on the DNB website. DNB has prepared a brochure explaining what you can expect from the assessment and the have an animation available.
Prepare well
DNB does not handle assessment applications that are not accompanied by a registration application.
How long does the registration procedure take?
If you have submitted a correct and complete application, DNB will register you within 2 months after receiving your application. DNB also assesses whether or not you meet the legal demands. If the information submitted is incomplete, the supervisor will not process your registration until you have submitted a complete application. You will be notified of this.
Ask advice
Ask an expert, for instance a legal advisor or accountant, to help you. That way, you can rest assured your application is complete and correct.
Costs for the registration application
To register, you pay a one-time fee of €5,000. Should you admit new board members after your registration, you will have to pay DNB for their fit and proper assessments. You will also need to apply for a new fit and proper assessment if the tasks or job of a board member change. The fee for an assessment of fitness is €1,100. An assessment of propriety costs €2,000.
